Around the world, there are a number of regional stock markets that deal in trading stocks in companies based or operating in their regions. Some of the major markets include the United States’ New York Stock Exchange, the Japan Stock Exchange, and markets in Hong Kong and India. One relatively small market that is making huge gains for investors that trade on it is the Colombo Stock Exchange (CSE). Here, we will attempt to establish a comparison between the CSE based in Sri Lanka and other major world markets.
An analysis of market trends in graphic form shows that the CSE has not been subject to as many major drops in prices as the larger markets. In fact, the leading index used to measure the performance of stocks on this market, the All Shares Price Index, shows that this market has enjoyed an almost steady climb over the past year.
The CSE is currently at an all time high with the graph trend showing that it has more climbing to do before it tops out and drops off slightly. The current increase over last year is approximately 126 percent. This is growth that is unparalleled in any of the other world stock markets. Investors who are looking for rapid growth of their portfolios would be more than happy to see growth potential like this in any market.
While all of the markets are somewhat higher than they were at this time last year, growth has been considerably slower. There have also been many more instances of the market making gains one day and losing them the next, usually with the release of financial data from large corporations or the federal governments of the countries these markets are located in.
For example, on the Japanese market, the key index is identified as the Nikkei. Over the course of the last 12 months, this index has amassed a total gain of only 15.45 percent over the same time last year. The US market has not grown much more than that at 26.40 percent.
Hong Kong and India also host stock markets that have featured growth in the last 12 months at 28.34 percent and 54.99 percent respectively. To most financial analysts, these represent huge gains that are not normally seen in such a short time. Yet, the CSE is outperforming them all in terms of growth.
It is true that there are nowhere near as many shares traded on the CSE each day as there are on the other markets. However, it is also true that those who invest in this market are enjoying much higher returns on their investments than those trading in the world’s larger markets.
Investing in the Sri Lanka based Colombo Stock Market is a strategy that definitely bears some study and consideration. All forecasts indicate that the current growth trends will continue for the foreseeable future. Most stocks traded on this exchange are immune, or protected from the types of conditions that can cause stock prices to plummet on larger markets. This makes the Colombo Stock Market a safer investment market as well as one with much higher growth.